Wilmington Capital Management Inc. (TSX:WCM.A)(TSX:WCM.B)
("Wilmington" or the "Corporation") today announced a net loss
attributable to shareholders for the three months ended March 31,
2013 of $57,000 or ($0.01) compared to a net loss attributable to
shareholders of $324,000 or ($0.04) for the same period in
2012.
To view a full copy of the Corporation's audited financial
results for the year ended December 31, 2012 including the
Corporation's audited consolidated financial statements,
accompanying MD&A and Annual Information Form, please refer to
the SEDAR website www.sedar.com.
Operating Highlights
Business Strategy
The Corporation's principal objectives are to make investments
capable of generating appreciation in value as opposed to current
income and to maximize shareholder returns by investing its own
capital alongside partners and co-investors in hard assets and
private equity funds. These assets are managed through the
Corporation's operating platforms where Wilmington can add scale
and improve valuations.
During the first quarter, the Corporation continued to take
steps to solidify the foundation of its three newly formed
operating platforms - self storage facilities, private equity funds
and natural gas assets. As at May 14, 2013, Wilmington had assets
under management in its operating platforms of approximately $148
million ($68 million representing Wilmington's share).
Investment in Real Storage Private Trust (the "Trust")
The Trust (44.78% owned) owns 17 self-storage facilities
comprising 645,978 square feet of rentable area and one development
property. The Trust showed significant improvements in 2013 as the
five properties in western Canada, which were for the most part in
the initial lease up stage, approached stabilized occupancy levels.
During the first quarter of 2013, occupancy levels averaged 78%,
compared to 75% in 2012. Operating margins in the first quarter of
2013 improved to 51% up from 43% for the comparable quarter in
2012.
Subsequent to March 31, 2013, the Trust acquired two
self-storage facilities - one located in the western region in Red
Deer, Alberta (the "Alberta Facility") and the other located in the
eastern region in Barrie, Ontario (the "Ontario Facility"). The
Alberta Facility is comprised of approximately 78,000 square feet
of rentable area, a portable storage business and a file retention
business. The Ontario Facility is comprised of approximately 39,000
square feet of rentable area with an additional 12,000 square foot
expansion currently under construction. The two acquisitions were
funded by two separate five-year, fixed-rate mortgages, an
unsecured credit facility, equity of the Trust and available cash.
Wilmington's cash contribution was $2.5 million bringing its total
investment in the Trust to approximately $10 million.
Investment in Network Capital Management Inc. ("NCI") and
Network 2012 Fund
Network Capital Management Inc. (50% owned) has funds under
management now totalling approximately $50 million and the majority
of Network's available capital has been successfully deployed in a
strong mix of junior oil and gas and service companies. Wilmington
committed $8 million of capital to the Network 2012 Fund.
Investment in Shackleton 2011 Limited Partnership (the
"Shackleton Partnership" or the "Partnership")
The natural gas assets owned through the Shackleton Partnership
(59% owned) have proven to be of high quality and present good
opportunities for growth and future development once we reach a
more favorable natural gas pricing environment. The weighted
average price realized during the three months ended March 31, 2013
was $3.17 per mcf and operating netbacks averaged $1.90 per mcf
(realized price of $2.10/mcf and netbacks of $0.65/mcf for the
comparable period in 2012). Natural gas production volumes for the
100% interest in the Shackleton field amounted to 4,452 mcf per day
(742 boepd). The outlook for natural gas pricing has improved
significantly and a better pricing environment will be beneficial
to the operating performance of the Shackleton assets. Of its 2013
production, approximately 50% has been hedged under fixed price
contracts with an average price of $3.18 per mcf.
Discontinued Operations
During the fourth quarter of 2012, the Corporation took steps to
rationalize its core business and entered into an agreement to sell
its interest in commercial land in San Francisco, California. The
sale is scheduled to close during the second quarter of 2013.
Outlook
The Corporation believes that the foundation for achieving
future growth through its three operating platforms - the Real
Storage Private Trust, Network Capital Management Inc. and the
Shackleton Partnership - are now firmly in place. In the years
ahead, the Corporation expects to add scale to these operating
platforms, improve valuations and earn attractive cash flow and
total returns for shareholders.
FINANCIAL HIGHLIGHTS
CONSOLIDATED STATEMENTS OF INCOME
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Unaudited Three months
ended March 31
(Thousands of Canadian Dollars, except per share
amounts) 2013 2012
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Income
Natural gas sales $ 1,275 $ 1,130
Royalties (177) (191)
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Natural gas revenue 1,098 939
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Investment and other income 38 32
Foreign exchange gain --- 27
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1,136 998
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Expenses
Petroleum operations 334 602
General and administrative 340 301
Depletion, depreciation and amortization 388 439
Stock compensation 46 41
Foreign exchange loss 28 ---
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Operating loss --- (385)
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Finance costs 78 86
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Loss before share of equity accounted investments and
income taxes (78) (471)
Share of net income (loss) from Real Storage Private
Trust 23 (30)
Share of net loss from Network Capital Management Inc. (22) (24)
Share of net loss from Network 2012 Fund (38) ---
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Loss before income taxes from continuing operations (115) (525)
Income tax benefit 16 142
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Net Loss from continuing operations (99) (383)
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Income (loss) from discontinued operations, net of tax 95 (15)
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Net Loss $ (4) $ (398)
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Net Loss attributable to:
Owners of the Corporation $ (57) $ (324)
Non-controlling interest 53 (74)
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$ (4) $ (398)
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Net Loss per share from continuing operations
Basic $ (0.02) $ (0.04)
Diluted $ (0.02) $ (0.04)
Net Loss per share
Basic $ (0.01) $ (0.04)
Diluted $ (0.01) $ (0.04)
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CONSOLIDATED BALANCE SHEET
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(Thousands of Canadian Dollars) March 31, December 31,
2013 2012
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Assets
Non-current assets
Investment in Real Storage Private Trust 7,294 7,271
Investment in Network Capital Management Inc. 1,690 1,712
Investment in Network 2012 Fund 7,777 7,554
Natural gas property, plant and equipment 17,606 17,840
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34,367 34,377
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Current assets
Income taxes receivable 494 435
Receivables and other assets 784 885
Cash and cash equivalents 6,502 6,601
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7,780 7,921
Assets held for sale 19,243 18,541
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27,023 26,462
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Total assets $ 61,390 $ 60,839
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Liabilities
Non-current liabilities
Asset retirement obligations 758 750
Deferred tax liabilities 343 259
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1,101 1,009
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Current liabilities
Accounts payable and accrued liabilities 936 1,024
Revolving loan facility 6,300 6,700
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7,236 7,724
Liabilities held for sale 22,095 21,432
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29,331 29,156
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Total liabilities 30,432 30,165
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Equity
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Shareholders' equity 27,091 26,860
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Non-controlling interest 3,867 3,814
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Total equity 30,958 30,674
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Total liabilities and equity $ 61,390 $ 60,839
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
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Unaudited Three months ended
March 31
(Thousands of Canadian Dollars) 2013 2012
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Net Loss $ (4) $ (398)
Items that may subsequently be reclassified to
Profit or Loss
Share of other comprehensive loss from Network
2012 Fund 261 ---
Future income taxes on above items (34) ---
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Other comprehensive income from continuing
operations 227 ---
Items that may subsequently be reclassified to
Profit or Loss
Other comprehensive (loss) income from
discontinued operations, net of tax 15 (17)
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Total other comprehensive income (loss) 242 (17)
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Comprehensive income (loss) $ 238 $ (415)
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Comprehensive income (loss) attributable to:
Owners of the Corporation $ 185 $ (341)
Non-controlling interest 53 (74)
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$ 238 $ (415)
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Executive Officers of the Corporation will be available at
403-800-0869 to answer any questions on the Corporation's financial
results.
This news release contains forward-looking statements concerning
the Corporation's business and operations. The Corporation cautions
that, by their nature, forward-looking statements involve risk and
uncertainty and the Corporation's actual results could differ
materially from those expressed or implied in such statements.
Reference should be made to the most recent Annual Information Form
for a description of the major risk factors.
Contacts: Wilmington Capital Management Inc. Executive Officers
(403) 800-0869
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